Vienna - Applying Austria's bail-out plan for the first time, leading financial institutions and the government are stepping in to rescue Constantia Privatbank AG, which was faced with a liquidity crunch, the finance ministry said Friday.

Five major Austrian banks are set to take over 100 per cent of the private banking institution that was reportedly suffering from an outflow of capital as major customers shifted their funds to bigger institutions.

In addition, the banks decided to inject 400 million euros (538 million dollars) into Constantia, while the Austrian national bank will contribute 50 million euros.

As foreseen in the Austrian government's banking package, the state will guarantee the capital injection.

"This joint initiative by the finance ministry, financial oversight authority, Austrian national bank and leading banks shows the stability of the Austrian financial market," said Vice Chancellor and Finance Minister Wilhelm Molterer.

The banks that will rescue Constantia are UniCredit Bank Austria AG, Erste Group Bank AG, Raiffeisen Zentralbank Oesterreich AG, Oesterreichische Volksbanken AG and BAWAG-P. S. K. AG.

With a balance sheet total of some 1.2 billion euros, Constantia manages around 10 billion euros for its customers.

The bank's equity ratio stands at 22.4 per cent, the finance ministry said.

Austria's government announced Monday it would provide up to 100 billion euros to guarantee lending among banks and to support their capitalisation.

The bail-out package still has to be approved by parliament. (dpa)